Pertamina to push ahead with Iraq venture

The Jakarta Post , Jakarta

State-owned oil and gas firm PT Pertamina hopes it will be able to proceed smoothly with its oil project in Iraq following the capture of former Iraqi strongman Saddam Hussein.

"The project, hopefully, will be able to proceed smoothly in a better security environment," Pertamina's spokesman Ridwan Nyak Baik told The Jakarta Post on Monday.

Pertamina has started oil exploration in Block III in the Western Desert, which is in the west of Iraq bordering on Saudi Arabia. It is to invest some US$24 million in the block over the first three years and another $16 million in the following two years. The block has an estimated 3 million barrels of oil.

Pertamina put its project in Iraq on hold when the U.S.-led coalition attacked Iraq in March.

Iraqi oil official Abdel Saheb Qotbi said the capture of former Iraqi president Saddam Hussein by the U.S. on Sunday lead to fewer attacks on the country's oil industry.

The country's oil ministry said there had been 80 acts of sabotage on oil and gas pipelines since Saddam's regime was toppled in April.

Ridwan said if everything goes according to plan, the company would start conducting a seismic survey to determine potential reserves in 2004.

He said if everything went well, Pertamina would be able to start production within seven years.

The company expects the new Iraqi government to respect the contract awarded to Pertamina.

"This is a business-to-business contract, and whatever the situation (in Iraq) the government there should respect it," Ridwan said.

Pertamina was concerned that the new government might suspend the contract, which was awarded by Saddam last year, after contracts with Russia and China were reportedly put on hold.

However, the Iraqi government gave the company the go-ahead to restart the project in November of this year.